Consumers’ possible strategies under beliefs (p = ρ; q)

Conditions

1) “Always inspect”

$c_i<\min \left(d\rho +\left(e-e\rho -d\rho \right)x,e\left(1-q\right)-\left(e-eq-dq\right)y\right)$

2) “Inspect negative, not inspect positive”

$e\left(1-q\right)-\left(e-eq-dq\right)y<c_i<d\rho +\left(e-e\rho -d\rho \right)x$

3) “Not inspect negative, inspect positive”

$d\rho +\left(e-e\rho -d\rho \right)x<c_i<e\left(1-q\right)-\left(e-eq-dq\right)y$

4) “Always not inspect”

$c_i>\max \left(d\rho +\left(e-e\rho -d\rho \right)x,e\left(1-q\right)-\left(e-eq-dq\right)y\right)$